Any major commercial landlord who engages in a pattern of extensive deception and chicanery that results in the evasion of hundreds of millions of dollars of taxes would face outrage and severe repercussions.
When that landlord is reported to be President Donald Trump and his family, the behavior is even more galling and the consequences even more significant.
An extensively documented investigation published online Tuesday by The New York Times alleges that the Trump family orchestrated a series of questionable and disturbing efforts to evade enormous amounts of income, gift and estate taxes. Those moves, according to the Times, meant that the Trump family paid about $52.2 million in taxes, when it should have paid $552 million.
What the story describes might not be criminal, but the Trumps still could be forced to pay hundreds of millions of dollars if audits find taxes are owed.
The account says that beyond enriching itself, the Trump family at times hurt others. For instance, by allegedly padding invoices at a company the family created, the president’s father, Fred Trump, found a way to give untaxed funds to his children, who owned the company, by passing them off as business transactions. The Times says this scheme also was used to justify increasing rents on his tenants because his phony maintenance expenses were so high.
Beyond the tax avoidance game, the reporting disproves Donald Trump’s signature image of himself as a self-made billionaire. His golden spoon from his father was much more than the $1 million he has repeatedly claimed. The Times puts the figure at $413 million in today’s dollars. Once again, the president’s ability to embellish with abandon, to tell and sell his story to the media and public, pushed a false reality.
The lengths the Trumps went to avoid taxes and exploit loopholes speaks to far more than just the president. It sheds light on a system that has long rewarded real estate executives, landlords and other power brokers. Its largest players write the rules that allow them to game the system. Ironically, it is the same unfair system so many Trump voters decry, the one so many thought they were defying when they cast ballots for Trump two years ago. Instead, they voted for the biggest insider of them all.
New York State and New York City officials are reviewing the Times account to see whether there is a way to claw back taxes the Trumps avoided. Good for them if they succeed. There’s also an opportunity here for state and city officials to examine the tax code to close loopholes and expand enforcement. We’d ask for the same from the federal government, but Trump’s not likely to allow the Internal Revenue Service to examine its rules and regulations.
It’s clear now that there are good reasons why Trump has refused to release his tax returns, but it’s also clearer than ever why he must do so. Again and again, Trump has demanded truth, openness and the release of key documents from others.
Now it’s his turn. — The editorial board